This element of what defines a trade secret is a primary example of how business law indeed conflicts with trade secrets and will be explored in more detail below. Definitions, Application and Content of Law and Comparison The legal definition of trade secrets varies by jurisdiction, but is generally narrowed down to consisting of three characteristics. Simply explained, a trade secret is a piece of information, for which reasonable measures have been taken by the company to protect it, and from which the company receives an economic benefit due to its exclusivity (18 USC, s.1839 s. (3)(a)(b)).
Although federal law does not govern the protection of trade secrets, most states have signed the Uniform Trade Secrets Act. A company secret is not a trademark or a patent, the latter two being governed by law in a different manner and involving different rules and concepts. Although it is not necessary to distinguish the three aspects in fine detail, a brief explanation of what makes trademarks and patents separate from trade secrets is necessary for the purpose of legal analysis.
The very existence of a trademark is dependent on its exposure to the public, so that a process of association may take place. For example, when one sees the ‘big yellow M’, one is immediately able to associate it with McDonald’s, just as thinking of Coca Cola conjures up that unforgettable logo. Such patents are meaningless unless public, quite the contrary to trade secrets. The patent is also a public form of protection, and makes available exclusive rights to the inventor in exchange for its release into public.
It is easy to understand how a trade secret is very different from a patent or a trademark, and its existence depends on its being kept secret. Yet how does the law distinguish between a useless personal secret and an extremely valuable company (trade) secret? Many mechanisms exist in order to protect the trade secret, which will be explored in order to critically assess their actual effectiveness in reality and whether they conflict with, rather than serve to protect trade secrets. Yet one may remain unclear as to what a trade secret may encompass in reality.
Problems concerning the ambit of ‘trade secret’ have not gone unnoticed, and many claim that ‘it is one of the most elusive and difficult concepts in law to define’ (Lear Siegler Inc V Ark-Ell Springs Inc, 569). The problem is not independent of other factors, however, and it is recognized that although almost any form of information can be classed as a trade secret, ‘but what will be protected as such, and when and against whom…are questions that cannot be answered with such certainty’ (Callman 1992: 14.06).
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